The small cap index continued higher. By the end of last week it had reached the Potential Reversal Zone (PRZ) of that Shark pattern at 113. With the pause there it looked like maybe that was it for now. Another lower high after a strong rally. And that still might be the case. The markets were disappointed by the Bank of Japan decision to take no action. The Japanese market lost over 3%. In the US the the S&P 500 has dropped back all the way to Monday levels. Not so bad. And the small caps? They look set to open near the Tuesday consolidation area at 114 on the Russell 2000 ETF ($IWM).

The small caps are continuing to show strength. And with that is separation from that PRZ on the Shark pattern. This would mark a failed reversal for other harmonic patterns, but the Shark comes with 2 PRZ’s. The second one stands above at about 118. And with the continued strength in the RSI and MACD, it looks like a run to that second PRZ is in order. If that occurs it would make for a higher high, above the December range and place the Russell firmly back in the consolidation levels of last fall. Like January and February did not happen.

If you like what you see above sign up for deeper analysis and trading strategy by using the Get Premium button above. As always you can see details of individual charts and more on my StockTwits page.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

Dragonfly Capital Updates

This material is provided for informational purposes only, as of the date hereof, and is subject to change without notice.This material may not be suitable for all investors and is not intended to be an offer, or the solicitation of any offer, to buy or sell any securities.